Brent crude, the global oil benchmark, fell 0.3% to $62.97 a barrel on London's ICE Futures exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading up 0.3% at $56.57 a barrel.

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In its closely watched monthly oil report, the International Energy Agency cut its crude demand growth outlook by 100,000 barrels a day for 2017 and 2018. The agency now expects demand to grow by 1.5 million barrels a day this year and 1.3 million barrels a day next year.

The data come a day after the Organization of the Petroleum Exporting Countries raised its forecasts for world oil demand growth for the same periods. The cartel now expects consumer appetite for oil to rise by 1.53 million barrels a day in 2017 and 1.51 million barrels a day in 2018.

Although it is common to have variations in oil market projections, some analyst view the discrepancy between the IEA and OPEC as unusually large.

"It will create some volatility as the market is going to be split between those that think the IEA is too much on the bearish side," said Olivier Jakob, managing director at consultancy Petromatrix, who views the IEA's forecast as better linked to movements in crude prices.

Oil prices have hovered around multi-year highs, buoyed by geopolitical turmoil in the Middle East and support from OPEC's ongoing effort to eliminate about 2% of global supply with the help of external producers. Analysts widely expect the participants to extend the deal through the end of 2018, beyond its current conclusion in March.

Overall, commercial petroleum stocks in the Organization for Economic Cooperation and Development--a group of industrialized, oil-consuming nations, including the U.S.--fell below 3 billion barrels in September for the first time in two years, the IEA said.

The IEA's outlook also differs from OPEC's with regard to how fast the oil market is rebalancing.

OPEC's latest estimate points to the oversupply in the market receding if the cartel keeps its supply at current levels, while the IEA says that at current production levels global stocks will be unchanged in 2018.

Some analysts say the IEA may be too cautious in its projections.

"We are now projecting small draws [next year] even before factoring in an extension of the cuts beyond March 2018," said Richard Mallinson, an analyst at consultancy Energy Aspects.

Still, investors are also watching for additional oil flows coming from the U.S.

On Monday the Energy Information Administration said it expected American shale oil output to rise by an additional 80,000 barrels a day and "reach a record 6.17 million barrels per day in December," said Commerzbank analysts.

This article was corrected at 8:27 a.m. ET because it incorrectly said current production levels may lead to a build-up in 2018. At current levels the IEA said that global stocks will be unchanged in 2018.

OPEC's latest estimate points to the oversupply in the market receding if the cartel keeps its supply at current levels, while the IEA says that at current production levels global stocks will be unchanged in 2018. "Oil Prices Creep Lower Amid Clashing Demand Outlooks," at 12:14 GMT, incorrectly said current production levels may lead to a build-up in 2018.